Tips for successfully trading Bitcoin

by Nick on February 6, 2018

“Bitcoin is seen as the future of money and the more we trade with it, the more we understand it,” a senior financial analyst at Olsson Capital confirmed a few days ago. Not only does this virtual currency change the way we think about money, it brings a new way of trading with currency. When trading Bitcoin, it may feel like you are on a roller-coaster ride with the never-ending price fluctuations of this cryptocurrency. Many still have their doubts about Bitcoin but when looking at the profit margin of the trades done with it, one can’t help but want to get a piece of the pie as well. But when trading, what can you do to increase your profit margin?

Only invest a set amount of money when trading with Bitcoin

With Bitcoin’s huge price hikes and falls over a very short period of time, you need to keep in mind that you can either lose a large amount of money or gain a huge profit from a successful trade. With that said, only invest the money you can afford to lose and nothing more. If you make an unsuccessful trade at a certain point in time, the money you invested was set at a limited amount, thus you don’t lose all your life’s savings. If you are a beginner trader, it is recommended that you start trading with a limited amount of money to build your confidence and learn the tricks of the trade before jumping in at the deep end. If you don’t you stand the chance of losing all the money you invested in Bitcoin trading, leaving you with empty pockets.

Trade with a number of goals in mind

Many traders take one look at the Bitcoin market dropping and immediately sell everything they have invested at a fraction of the price they could have gotten if they had only waited for the drop to subside. When trading, make sure you trade according to pre-set goals such as what hours you will be trading, what amount you will be trading with and when you will close in on a specific trade. You might say that if the Bitcoin price drops to a certain level, you will cash out or sell a few coins. Do not let the fear of losing get in the way of making rational trading choices.

Take note of the trader stop-loss option

A stop-loss option in trading is the automated process of selling your stock if the loss you will have reaches a certain amount. If you trade according to a set stop-loss amount and the trades you make are unprofitable, you will lose money only until your loss reaches the set stop-loss limit. As soon as it reaches that point, your stock is immediately liquidated, preventing you from losing even more. That is a great option traders use when wanting to ensure they still make a small profit as it is better to lose a little but still have something left rather than lose everything and crashing with an unfavourable trade.

Reading trade charts

When trading Bitcoin, you need to make sure you understand the descriptions, charts and terms used when trading choices need to be made. Before making that trade, the average trader will inspect market trends set out on charts. In order for you to make the right trade at the right time, you need to make these charts your road to success. Technical analysis of Bitcoin charts can be daunting at times but the longer you trade, the easier it will be to read and you will then be able to make predictions with precision.

Don’t be afraid to take the crypto leap of faith

To this day, scepticism is at the order of the day when it comes to cryptocurrencies such as Bitcoin. Many financial experts address Bitcoin to be a “bubble” and will completely destroy the way investing is done. However, as we live in the 21st century, we need to embrace the path technology leads us on.

While following traditional methods of trading stocks, adding Bitcoin to your list of profit-making strategies, you already are one step ahead of the rest.

Follow all daily trends of the cryptocurrency world if you want to find a place to invest. And learn to wait a perfect moment to sell. Remember, in this chain everyone want to sell you something. Be smart.